(Edgar Glimpses Via Acquire Media NewsEdge) The following discussion contains forward-looking statements that reflect our
plans, estimates and beliefs. Our actual results could differ materially from
those discussed in the forward looking statements. Factors that could cause or
contribute to such differences include, but are not limited to those discussed
below and in our annual report on Form 10-K/A for the year ended December 31,
2013, filed with the Securities and Exchange Commission on June 17, 2014,
particularly in the section entitled "Risk Factors".

Our condensed consolidated interim financial statements are stated in United
States Dollars and are prepared in accordance with United States Generally
Accepted Accounting Principles.

Overview
As mentioned in Note 7, effective March 4, 2014, Alternet Systems Inc. sold
effectively all of Alternet Transaction Systems, Inc.'s ("ATS") business and
assets to Utiba, As a result the Company is no longer engaged in providing
mobile financial services. Along the vision outlined below, in the first
quarter, the Company entered into its first arrangement in the digital currency
industry. The Company also expects to pursue potential opportunities to grow
through mergers and acquisitions. The Company has identified several
opportunities and initiated initial discovery processes.

Alternet's vision is based on the following principles
[[Image Removed]]
Cloud based, secure, regulatory compliant, global currencies are needed to
service this emerging market. As the usage and dependence of Smart Mobile
Devices continues to increase there will be a need for more intelligent and
effective Money.

In 2014, the Company's expected milestones are:
• to enter into arrangements with select digital currencies, with the
first having taken place in February 2014 with Ven;
• to provide end to end security for digital currencies; the company has
entered into a strategic joint venture with BIOMETRY for "BioME", which
replaces passwords and PINs through the combination of dynamic facial
and voice recognition in a unique ID system;
• to launch the digital currency bank, fully compliant with government
regulations, FX exchange capabilities;
• to invest in micro payment services to the unbanked and global
diasporas;
• to invest in alternative financial services to the retail industry
emerging markets;
• to attract key talent specialized in the digital economy; and
• . to prepare to apply to list our common stock on a national securities
exchange.

VEN is a global digital currency traded in international financial markets and
originally used by members of a social network service, Hub Culture, to buy,
share, and trade knowledge, goods, and services. The value of Ven is determined
on the financial markets from a basket of currencies, commodities and carbon
futures. It trades against major currencies at floating exchange rates.

Hub Culture is an invitation-led social network service that operates the global
digital currency Ven, and according to its website, is "the first to merge
online and physical world environments." It was founded in November 2002. The
Hub Culture group of companies is privately held with offices in Bermuda, Hong
Kong, London and New York, with a network of knowledge brokers in over 20
locations worldwide. The web site is www.hubculture.com.

In the first quarter we entered into a relationship with VEN and Hub Culture to
become a VEN Authority. This relationship will allow us to become an issuer of
the VEN Currency on a global basis, leveraging the experience and the strength
of this Digital Currency. We expect to start generating revenues from the sale
of the currency, by the end of 2014.

The Company's digital bank initiative, will focus on bringing to market
innovative consumer products, including a multi-asset debit and credit card.

This initiative is the first of its kind with dynamic currency conversion from
digital to physical currency, digital currency exchange and merchant acquisition
solutions. All of these services will include the seamless integration of
existing digital currencies, including Bitcoin, Ven, Ripple and others. The
company expects to have a global reach, initially launching in Latin America and
the Caribbean, with expansion opportunities into Africa and Eastern Europe.

We will actively participate in the industry associations and promoting
organizations, expecting to have an active involvement. We will also seek
speaking and industry show participation, promoting our new initiatives.

--------------------------------------------------------------------------------
Digital and Mobile Security Software and Services
In 2013 International Mobile Security (IMS) was wound down. IMS is expected to
be restructured in 2014 and be used as the vehicle to provide services and
products securing financial transactions and digital currency.

Results of Operations:
The three and six months ended June 30, 2014 compared to three and six months
ended June 30, 2013
The Company's results, on a consolidated basis, reflect its own results
consolidated with its subsidiaries. For the remainder of this part, the term
"Company" refers to both the Company and its wholly owned and one majority owned
subsidiary, International Mobile Security, Inc. ("IMS"). Alternet has a
controlling interest in IMS.

Upon closing of the ATS Transaction described in Note 7 of the financial
statements, the Company acquired the 49% non-controlling in Alternet
Transactions Systems, Inc. ("ATS"), doing business as Utiba Americas, increasing
the Company's ownership to 100%.

Net Sales
For the three months ended June 30, 2014 and 2013, the Company had net sales of
$Nil and $1,500, respectively. For the six months ended June 30, 2014 and 2013,
the Company had net sales of $Nil and$1,641, respectively. The low sales were a
result of the Company focusing its efforts on ATS, which was classified as a
discontinued operation at December 31, 2013. All revenue earned by ATS up to
March 4, 2014 is included in discontinued operations.

Selling, General and Administrative Expenses
The operating and administrative expenses for the three months ended June 30,
2014 and 2013 totaled $328,990 and$790,956, respectively.. The table below
details the major changes in administrative expenditures for the three months
ended June 30, 2014 and 2013.

Expenses Increase / Decrease in Explanation for Change -
Expenses Three Months Ended June 30, 2014 as
Compared to the Three Months Ended June
30, 2013
Investor relations Decrease of $29,382 Reduced investor communications was
required during the quarter ended June
30, 2014.

Management and Decrease of $264,872 The quarter ended June 30, 2013 included
consulting management bonuses of $455,000 which
were not awarded in the current period.Office and general Increase of $41,122 Increased online marketing due to the
Company rebranding its image after the
closing of the ATS Transaction.

Professional fees Increase of $48,226 Increased accounting fees relating to
the filing of quarterly reports and
payroll tax payments.

Salaries Decrease of $283,242 The quarter ended June 30, 2013 included
(recovery) an estimate for payroll tax penalties
and interest of $100,318. The quarter
ended June 30, 2014 included a reversal
of $192,910 of estimated interest that
was over accrued in fiscal 2013.

Travel Increase of $28,895 Increased need for travel for meetings
and due diligence on new initiatives
being explored by the Company.

--------------------------------------------------------------------------------
The operating and administrative expenses for the six months ended June 30, 2014
and 2013 totaled $1,322,752 and $1,003,976, respectively. The table below
details the major changes in administrative expenditures for the six months
ended June 30, 2014 and 2013.

Expenses Increase / Decrease in Explanation for Change -
Expenses Six Months Ended June 30, 2014 as
Compared to Six Months Ended June 30,
2013
Investor relations Increase of $26,680 Additional investor communications was
required during the period ended June
30, 2014 due to the ATS Transaction.

Research and Increase of $500,000 In 2014, the Company paid a fee of
development $500,000 in connection with the ability
to offer and promote digital currency.

Management and Decrease of $56,198 A majority of the management and
consulting consulting fees incurred in 2013 related
to ATS. Subsequent to the ATS
Transaction, the management fees
incurred by Alternet were no longer
being charged to ATS as the operations
of ATS had been discontinued.

Additionally, the period ended June 30,
2013 included management bonuses of
$455,000 which were not awarded in the
current period.Office and general Increase of $65,275 Increased online marketing due to the
Company rebranding its image after the
closing of the ATS Transaction.

Professional fees Increase of $48,953 Increased accounting fees relating to
the filing of quarterly reports and
payroll tax payments.

Salaries Decrease of $331,521 The period ended June 30, 2013 included
an estimate for payroll tax penalties
and interest of $112,098. The quarter
ended June 30, 2014 included a reversal
of $192,910 of estimated interest that
was over accrued in fiscal 2013.

Travel Increase of $69,249 Increased need for travel for meetings
and due diligence on new initiatives
being explored by the Company.

Interest and Other Expenses
The Company's interest expense decreased to $17,685 for the three months ended
June 30, 2014 and $56,803 for the six months ended June 30, 2014 compared to
$139,199 and $236,613 for the three and six months ended June 30, 2013.This was
due to the decrease in loans outstanding during the period, reflecting the
repayment of several loans payable.

Net Income (Loss)
For the three months ended June 30, 2014, the Company had a net and
comprehensive loss attributable to Alternet System, Inc. from continuing
operations of $(346,941) or $(0.00) per share and an overall net and
comprehensive loss of $(276,927) or $(0.00) per share, a decrease of 60.46% and
80.06% respectively, when compared to the corresponding three months ended June
30, 2013 which had a net and comprehensive loss attributable to Alternet System,
Inc. from continuing operations of $(877,541) or $(0.02) per share and an
overall net and comprehensive loss of $(1,388,791) or $(0.02) per share.

For the six months ended June 30, 2014, the Company had a net and comprehensive
loss attributable to Alternet System, Inc. from continuing operations of
$(1,366,105) or $(0.01) per share and an overall net and comprehensive income
(loss) of $1,626,432 or $0.02 per share, an increase of 15.04% and a decrease of
185,944% respectively, when compared to the corresponding six months period
ended June 30, 2013 which had a net and comprehensive loss attributable to
Alternet System, Inc. from continuing operations of $(1,187,525) or $(0.01) per
share and an overall net and comprehensive income (loss) of $(1,892,576) or
$(0.02) per share.

The increased losses from continuing operations is mostly attributable to an
Authority fee the Company was required to pay to be able to promote the Ven
digital currency while the overall income is primarily attributable to the sale
of ATS's Assets.

Liquidity and Capital Resources
As of June 30, 2014, the Company had $262,349 (December 31, 2013 - $Nil) cash in
the bank, accounts receivable of $11,370 (December 31, 2013 - $Nil), and sale
proceeds held in escrow relating to the ATS Transaction of $667,264 (December
31, 2013 - $Nil). At June 30, 2014, the Company had a working capital deficiency
of $3,572,031 (December 31, 2013 - $5,168,849). The Company is currently
pursuing financing, and has engaged an investment bank to raise additional
capital to fund ongoing operations. The Company's ability to continue as a going
concern will be negatively affected if it is unsuccessful.

--------------------------------------------------------------------------------
Accounts payable were $1,895,410 at June 30, 2014 compared to accounts payable
of $1,466,546 at December 31, 2013. As at June 30, 2014, the Company's current
liabilities were $4,656,597, a reduction of $2,582,861 from the current
liabilities of $7,239,458 at December 31, 2013.

Plan of Operation
In 2014 Alternet will seek to transform into an accelerator of high growth,
emerging mobile and digital, technology and services companies, in the digital
currency and the mobile and digital security fields. Our goal is to expand the
horizons of individuals and organizations, by providing a growth and networking
platform, empowering them to go beyond their expectations and goals
The new vision of Alternet is to accelerate the future of money through the
creation of a digital bank, building security around the digital monetary
ecosystem, and providing an exchange that allows for the movement from virtual
money to fiat currency
Our new product and service will offer consumers and businesses the cost savings
and speed associated with the internet while being compliant with anti-money
laundering procedures in place at US brokerage firms and banks
In 2014, the Company's expected milestones are:
• to enter into arrangements with select digital currencies, with the
first having taken place in February 2014 with Ven;
• to provide end to end security for digital currencies; the company has
entered into a strategic joint venture with BIOMETRY for "BioME", which
replaces passwords and PINs through the combination of dynamic facial
and voice recognition in a unique ID system;
• to launch the digital currency bank, fully compliant with government
regulations, FX exchange capabilities;
• to invest in micro payment services to the unbanked and global
diasporas;
• to invest in alternative financial services to the retail industry
emerging markets;
• to attract key talent specialized in the digital economy; and
• . to prepare to apply to list our common stock on a national securities
exchange.

The Company is entering into its next phase which will leverage the experience
and knowledge in mobile technology and financial services to provide solutions
in the digital currency and the mobile and digital security fields. Investments
in these fields are underway.

Critical Accounting Policies
The discussion and analysis of our financial condition and results of operations
are based upon our financial statements, which have been prepared in accordance
with the accounting principles generally accepted in the United States of
America. Preparing financial statements requires management to make estimates
and assumptions that affect the reported amounts of assets, liabilities,
revenue, and expenses. These estimates and assumptions are affected by
management's application of accounting policies. We believe that understanding
the basis and nature of the estimates and assumptions involved with the
following aspects of our financial statements is critical to an understanding of
our financial statements.

Basis of Presentation and Consolidation
The consolidated financial statements and related notes are presented in
accordance with accounting principles generally accepted in the United States,
and are expressed in United States dollars. The financial statements include the
accounts of the Company and its wholly owned and majority owned subsidiaries.

Our fiscal year-end is December 31.

The minority interests of ATS up to March 4, 2014, the date the Company gained
100% ownership, IMS, and ATS's and IMS's wholly owned subsidiaries have been
deducted from earnings and equity. All significant intercompany transactions and
account balances have been eliminated.

Use of Estimates and Assumptions
The preparation of financial statements in conformity with generally accepted
accounting principles in the United States of America requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the financial
statement date and the reported amounts of revenues and expenses during the
reporting period. The Company regularly evaluates estimates and assumptions
related to the useful life and recoverability of long-lived assets, fair value
of convertible notes payable and derivative liabilities. The Company bases its
estimates and assumptions on current facts, historical experience and various
other factors that it believes to be reasonable under the circumstances, the
results of which form the basis for making judgments about the carrying value of
assets and liabilities and the accrual of costs and expenses that are not
readily apparent from other sources. The actual results experienced by the
Company may differ materially and adversely from the Company's estimates. To the
extent there are material differences between estimates and the actual results,
future results of operations will be affected.

--------------------------------------------------------------------------------
Cash and Cash Equivalents
The Company considers all liquid investments, with an original maturity of three
months or less when purchased, to be cash equivalents.

Accounts Receivable and Allowance for Doubtful Accounts
Trade accounts receivable are stated at the amount the Company expects to
collect. The Company maintains allowances for doubtful accounts for estimated
losses resulting from the inability of its customers to make required payments.

Management considers the following factors when determining the collectability
of specific customer accounts: customer credit-worthiness, past transaction
history with the customer, current economic industry trends, and changes in
customer payment terms. Past due balances over 90 days and other higher risk
amounts are reviewed individually for collectability. If the financial condition
of the Company's customers were to deteriorate, adversely affecting their
ability to make payments, additional allowances would be required. Based on
management's assessment, the Company provides for estimated uncollectible
amounts through a charge to earnings and a credit to a valuation allowance.

Balances that remain outstanding after the Company has used reasonable
collection efforts are written off through a charge to the valuation allowance
and a credit to accounts receivable.

Equipment
Fixed assets are recorded at cost and depreciated at the following rates:
Computer equipment - 30% declining balance basis
Computer software - 30% declining balance basis
Equipment - 20% declining balance basis
Long-Lived Assets Including Other Acquired Intellectual Property
Management monitors the recoverability of long-lived assets and intangibles
based on estimates using factors such as current market value, future asset
utilization, and future undiscounted cash flows expected to result from its
investment or use of the related assets. The Company's policy is to record any
impairment loss in the period when it is determined that the carrying amount of
the asset may not be recoverable. Any impairment loss is calculated as the
excess of the carrying value over estimated realizable value. The Company did
not recognize an impairment charges related to long-lived assets during the six
months ended June 30, 2014 and 2013.

Intangible assets deemed to have an indefinite life are not amortized but are
subject to impairment tests at each reporting date. The Company assesses the
impairment of intangible assets on a quarterly basis or whenever events or
changes in circumstances indicate that the fair value is less than its carrying
value. If the carrying amount of the intangible asset exceeds its fair value,
the intangible asset is considered impaired and the second step of the test is
performed to determine the amount of impairment loss, if any. The Company did
not recognized an impairment charges related to indefinite lived intangible
assets during the six months ended June 30, 2014 and 2013.

Revenue Recognition
Up to March 4, 2014, the Company entered into sales arrangements that may have
provided for multiple deliverables to a customer. Software sales may have
included the sale of a software license, implementation/customization services,
and/or ongoing support services.

In order to treat deliverables in a multiple-deliverable arrangement as separate
units of accounting, the deliverables must have standalone value upon delivery.

If the deliverables have standalone value upon delivery, the Company accounts
for each deliverable separately. Licenses, support fees, and hosted services
have standalone value as such services are often sold separately. In determining
whether implementation/customization services have standalone value, the Company
considers the following factors for each agreement: availability of the services
from other vendors, the nature of the services, the timing of when the services
contract was signed in comparison to the services start date, and the
contractual dependence of the customization service on the customer's
satisfaction with the implementation/customization services work.

The Company concluded that all of the services included in multiple-deliverable
arrangements executed had standalone values when multiple deliverables included
in an arrangement are separated into different units of accounting. The
arrangement consideration is allocated to the identified separate units based on
a relative selling price hierarchy. The Company determines the relative selling
price for a deliverable based on its vendor-specific objective evidence of
selling price ("VSOE"), if available, or its best estimate of selling price
("BESP"), if VSOE is not available. The Company has determined that third-party
evidence of selling price ("TPE") is not a practical alternative due to
differences in its service offerings compared to other parties and the
availability of relevant third party pricing information. The amount of revenue
allocated to delivered items is limited by contingent revenue, if any.

The Company has not established VSOE for a majority of its revenue due to lack
of pricing consistency, the customer specific requests, and other factors.

Accordingly, the Company used its BESP to determine the relative selling price.

--------------------------------------------------------------------------------
The Company determined BESP by considering its overall pricing objectives and
market conditions. Significant pricing practices taken into consideration
include the Company's discounting practices, the size and volume of the
Company's transactions, the geographic area where services are sold, its market
strategy, historic contractually stated prices and prior relationships, and
future service sales with certain customers. The determination of BESP is made
through consultation with and approval by the Company's management, taking into
consideration the market strategy. As the Company's market strategies evolve,
the Company may modify its pricing practices in the future, which could result
in changes in selling prices.

Revenue was recognized upon delivery or when services were performed, provided
that persuasive evidence of a sales arrangement existed, both title and risk of
loss passed to the customer, and collection was reasonably assured. Persuasive
evidence of a sales arrangement existed upon execution of a written sales
agreement or signed purchase order that constituted a fixed and legally binding
commitment between the Company and the buyer. Specifically, revenue from the
sale of licenses was recognized when the title of the license transferred to the
customer while revenue from implementation/customization services performed was
recognized upon successful completion of a User Acceptance Test ("UAT"). If a
successful UAT was never achieved and the sales arrangement was cancelled, the
Company recognized any deferred revenue not required to be refunded to the
customer.

The Company's payment terms vary by client. To reduce credit risk in connection
with software license and support sales, the Company may, depending upon the
circumstances, require significant deposits prior to delivery. In some
circumstances, the Company may require payment in full for its products prior to
delivery. For support and hosted services, the Company sold customers service
agreements that were recorded as deferred revenue and provided for payment in
advance on either an annual or other periodic basis. Revenue for these support
services was recognized ratable over the term of the agreement.

Subsequent to March 4, 2014 the Company is implementing the criteria outlined in
SAB 104 and recognizing revenue when:
º persuasive evidence of an arrangement exists;
º delivery has occurred or services have been rendered;
º the seller's price to the buyer is fixed or determinable; and
º collectability is reasonably assured.

Research and Development
The Company expenses costs when incurred for items associated with researching
and developing new sources of revenue.

Digital Currency Transactions
The Company enters into transactions that are denominated in digital currency
(Ven). These transactions result in digital currency denominated assets and
liabilities that are revalued periodically. Upon revaluation, transaction gains
and losses are generated and are reported as unrealized gains and losses in
other gain (loss), net in the Consolidated Statements of Operations. The Company
determines fair value as of the balance sheet date based on Level I inputs which
consist of quoted prices in active markets. The value of the Company's digital
currency is $125,000 as of March 31, 2014. Due to the uncertainty regarding the
current and future accounting treatment and tax, legal and regulatory
requirements relating to digital currencies or transactions utilizing digital
currencies, such accounting, legal, regulatory and tax developments or other
requirements may adversely affect us.

Debt with Conversion Options
The Company accounts for convertible debentures in accordance with ASC Topic
470-20, Debt with Conversion and Other Options, which applies to all convertible
debt instruments that have a ''net settlement feature,'' which means instruments
that by their terms may be settled either wholly or partially in cash upon
conversion. Accordingly, the liability and equity components of convertible debt
instruments that may be settled wholly or partially in cash upon conversion
should be accounted for separately in a manner reflective of their issuer's
nonconvertible debt borrowing rate. Conversion features determined to be
beneficial to the holder are valued at fair value and recorded to additional
paid in capital. Any discount derived from determining the fair value to the
debenture conversion features is amortized to interest expense over the life of
the debenture. The unamortized costs, if any, upon the conversion of the
debentures is expensed to interest immediately.

Leases
The Company leased operating facilities which include switches, other network
equipment, and premises. Rentals payable under operating leases were charged to
the statements of operation on a straight line basis over the term of the
relevant lease. For capital leases, the present value of future minimum lease
payments at the inception of the lease was reflected as an asset and a liability
in the statement of financial position. Amounts due within one year are
classified as short-term liabilities and the remaining balance as long-term
liabilities.

--------------------------------------------------------------------------------
Foreign Currency Translation
The Company's functional currency and its reporting currency is the United
States Dollar. Foreign denominated monetary assets and liabilities are
translated to their United States dollar equivalents using foreign exchange
rates which prevailed at the balance sheet date. Revenue and expenses are
translated at average rates of exchange during the year. Related translation
adjustments are reported as a separate component of stockholders' equity
(deficit), whereas gains or losses resulting from foreign currency transactions
are included in the results of operations.

Fair Value of Financial Instruments
The Company has determined the estimated fair value of financial instruments
using available market information and appropriate valuation methodologies. The
carrying value of the Company's financial instruments, consisting of accounts
receivable, checks in excess of bank balances, accounts payable and accrued
liabilities, wages payable, accrued payroll taxes, other loans payable,
stock-based compensation, warrants, and due to related parties, approximate
their fair value due to the relatively short maturity of these instruments.

Income Taxes
The Company accounts for income taxes under a method which requires the Company
to recognize deferred tax assets and liabilities for the expected future tax
consequences of events that have been recognized in the Company's financial
statements or tax returns. Under this method, deferred tax assets and
liabilities are determined based on the difference between the financial
statements carrying amounts and tax basis of assets and liabilities using
enacted tax rates. The Company recognizes the tax benefit from an uncertain tax
position only if it is more likely than not the tax position will be sustained
on examination by the taxing authorities, based on the technical merits of the
position. The tax benefits recognized in the financial statements from such
positions are then measured based on the largest benefit that has a greater than
50% likelihood of being realized upon settlement.

Stock-Based Compensation
The Company accounts for its share-based compensation plans in accordance with
the fair value recognition provisions of ASC 718 Compensation-Stock
Compensation. The Company utilizes the Black-Scholes option pricing model as its
method for determining the fair value of stock option grants. ASC 718 requires
the fair value of all share-based awards that are expected to vest to be
recognized in the statements of operations over the service or vesting period of
each award. The Company uses the straight-line method of attributing the value
of share-based compensation expense for all stock option grants over the
requisite service period.

Income (Loss) per Share
The Company computes net earnings (loss) per share in accordance with ASC Topic
260, Earnings Per Share. Topic 260 requires presentation of both basic and
diluted earnings per share (EPS). Basic EPS is computed by dividing net income
(loss) available to common shareholders (numerator) by the weighted average
number of common shares outstanding (denominator) during the period. Diluted EPS
gives effect to all dilutive potential common shares outstanding during the
period including warrants using the treasury stock method. Diluted EPS excludes
all dilutive potential common shares if their effect is anti-dilutive.

At June 30, 2014 and December 31, 2013 the Company had no warrants or options
outstanding to consider in income (loss) per share calculation.

This ASU is to be applied prospectively for all disposals of an entity that
occur within annual periods beginning on or after December 15, 2014, and interim
periods beginning on or after December 15, 2015. Additionally, this ASU is to be
applied to all business activated that, on acquisition, are classified as held
for sale that occur within annual periods beginning on or after December 15,
2014, and interim periods within annual periods beginning on or after December
15, 2015. ASU No 2014-08 addresses concerns about the accounting for
discontinued operations and the disposal of small groups of assets that are
recurring in nature but qualify as discontinued operations under subtopic
205-20. Management does not anticipate that this accounting pronouncement will
have any material future effect on our consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with
Customers (Topic 606). This ASU is effective for annual reporting periods
beginning after December 15, 2016. ASU No 2014-09 addresses concerns about
weaknesses and inconsistencies in revenue recognition across entities,
industries, jurisdictions, and capital markets. Management does not anticipate
that this accounting pronouncement will have any material future effect on our
consolidated financial statements.

--------------------------------------------------------------------------------
In June 2014, the FASB issued ASU No. 2014-12, Compensation - Stock Compensation
(Topic 718): Accounting for Share-Based Payments When the Terms of an Award
Provide That a Performance Target Could Be Achieved after the Requisite Service
Period. This ASU is effective for annual reporting periods beginning after
December 15, 2015. ASU No 2014-12 clarifies the diverse accounting treatments
used by entities to account for awards based on performance targets achieved
after the requisite period. Management does not anticipate that this accounting
pronouncement will have any material future effect on our consolidated financial
statements.

Other recent accounting pronouncements issued by the FASB (including its
Emerging Issues Task Force), the American Institute of Certified Public
Accountants, and the SEC did not, or are not believed by management to, have a
material impact on the Company's present or future financial position, results
of operations or cash flows.